Generex Biotechnology Corp. (OTCMKTS:GNBT) Continues Upwards

1GNBTchart.pngThe fact that yesterday’s market was cut in half did not stop the stock of Generex Biotechnology Corp. (OTCMKTS:GNBT) of having the best session for over a month. It added 12% to its value and for a brief moment in early trading touched upon $0.5 but subsided and at closing time was sitting at $0.039. Traded volume managed to reach substantial levels with 10 million shares shifted in the short span of the session.

GNBT are a medical company specializing in the research and development of drug delivery systems and technologies. The main focus of their operations has been the development of Generex Oral-lyn, an insulin drug that is administered as a fine spray instead of the traditional invasive methods. Up to now GNBT have been successful in receiving approval for its commercialization in Ecuador, Lebanon and Algeria. But getting the product approved in India proved to be far more difficult due to the specific requirements in their regulations. GNBT were forced to conduct another study in the country, the field portion of which was completed in 2012. A response from the Indian authority is expected during the third quarter of this year.

The company has another possible product currently developed by their wholly-owned subsidiary Antigen Express. They are trying to create an immunotherapeutic vaccine named AE37. The drug is currently undergoing Phase II clinical trials for patients with HER-2/neu breast cancer. For now the company is optimistic about he future of the technology based on the positive results they have been receiving and have filed for an Investigational New Drug with the FDA.

The problem is, as always with development stage medical companies, their financial stability. GNBT‘s fundamentals according to the quarterly report for the period ending April 30 were:

  • $400 thousand cash
  • $475 thousand total current assets
  • $8 million total current liabilities 
  • Zero revenues for the period
  • $4.9 million net loss

The company is in dire need of fresh funds. They were even forced to start selling of some of their assets in order to acquire capital. Since their inception GNBT have accumulated the staggering deficit of $362 million. And the company NTEKchart.pngthemselves are not expecting to start generating revenues in next year or so. Investors should also keep in mind the constant dilution of the stock. In an attempt to alleviate the dismal financial situation GNBT entered into another agreement according to which they sold 1225 shares of the new non-voting Series E 9% Convertible Preferred Stock in exchange of $1,2 million. Upon conversion some 81 million common shares would have to be issued.

Another company that closed in the green just before the holiday was Xumanii, Inc (OTCMKTS:XUII). The stock rose by 10% on the combined effort of fluff PR and hard mailer promotion. NanoTech Entertainment, Inc. (OTCMKTS:NTEK) regained the positions they lost and closed at $0.08.

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